A study recently released by Frontiers of Freedom suggests that in the Obama administration, money talks. The paper insists that crony capitalism is behind many of the Justice Department’s decisions when it comes to approving or rejecting mergers, and that “friends” of the Administration stand to gain enormous financial “gifts” in return for their generosity.
This is a good thing to keep in mind with the Comcast and Time Warner merger up for debate. How the Obama Administration treats its friends and enemies has followed a very particular pattern since 2008.
The study examines how the correlation between the political leanings of companies and how much help they receive from the federal government is just a little too convenient to be ignored.
- Solyndra is probably the most famous example. George Kaiser, a backer of the company, was a major fundraiser for President Obama. The Department of Energy propped up the company with a $536 million dollar loan, which was completely wasted on the company: it was bankrupt a year later. The company is unlikely to ever repay the federal government.
- United Health Group is projected to increase their earnings with the help of Obamacare, and one of its subsidiaries, Quality Software Services, Inc., won a $90 million contract related to the roll-out of Healthcare.gov. United Health’s Executive Vice President bundled $500,000 for the President, and he and his wife directly donated $25,700 since 2007. His wife was appointed Ambassador to Trinidad and Tobago.
- After Big Labor spent $75 million on political donations, with 92% going to Democrats, and helped organize massive Get Out The Vote efforts for the Democratic Party, the unions were rewarded with exemptions to reinsurance fees under Obamacare. Unions receive over 85% of all ACA waivers.
- AT&T and T-Mobile sought permission for a $39 billion merger in 2011. The proposed merger, they argued, would ultimately save consumers money on cell phone bills. In record time, the Justice Department announced it would sue to block the merger, claiming that the resulting 40% control the merged companies would have would increase costs and limit choices. AT&T CEO Randall Stephenson has a reputation for being a “Bible Belt, pro-free market, Republican.” His employees have by and large donated to Republican candidates.
The Comcast and Time Warner merger is almost identical to the AT&T and T-Mobile merger, but two things are different: it’s more expensive, and the CEOs are very friendly with the Obamas. Comcast CEO Brian Roberts is a frequent golfing buddy of the President and has donated $76,000 to Democrats from 2006-2009. The company’s Executive Vice President and his wife directly donated upwards of $500,000 in Obama’s re-election campaign. Time Warner similarly gives to the Democratic Party.